Why Cryptocurrency ETFs Are Such a Hard Sell

A number of firms in the U.S. have been once again denied the ability to launch a cryptocurrency-focused exchange traded fund (ETF), with the Securities and Exchange Commission in the U.S. once again denying applications from high-profile ETF providers to offer such a product to consumers.

The reason for this level of scrutiny appears to be warranted as governments and organizations which monitor investor safety have continued to point to issues with transparency and disclosure rules within a sector masked in opaqueness, leading some to question whether price manipulation has taken the value of these electronic tokens to unreasonable levels.

I have pointed in the past to what I believe to (still) be a massive bubble in the cryptocurrency space, and have cited my own concerns about investors jumping into such products, given the apparent ability for “whales” (those who hold large chunks of these products) to buy, sell, or hold and therefore influence the price of cryptocurrencies by “painting the tape.”

While no such activity has been conclusively proven to be taking place, investors who are erring on the side of being cautious long-term investors ought to look elsewhere for long-term returns at this point in time.

Blockchain, the technology underpinning cryptocurrencies such as Bitcoin and Ethereum, is a sector which has been shown to have value for large companies – a blockchain ETF in the U.S. market may be coming shortly, but I wouldn’t hold my breath at this point in time.